Mumbai Desalination Plant ( Proposed ) : a White Elephant ?

 

Context :

BMC sets the ball rolling for first desalination plant    /   HT   /   15 Nov 2021

Extract :

The Brihanmumbai Municipal Corporation (BMC) has set the ball rolling for the construction of the city’s first desalination plant, which will convert sea water to drinking water.

The civic body has decided to appoint consultants for vetting of designs for the 200 million litres per day (MLD) desalination plant in the western suburbs.

Construction should start next year and the plant is expected to be functional in the next 4 years. The BMC anticipates the construction cost to be ₹ 18,000 crore.

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MY  TAKE  :

A news report which appeared in Times of India, on 29 June 2021 ( approx. 5 months back ) , mentioned that this plant would cost Rs 1600 Crore

(  BMC, Israeli co ink pact for Maharashtra’s first desalination plant  /  TOI  /  29 June 2021 )

 

Based on that report, I had calculated the cost of desalinated water as follows :

( source :   With a pinch of Salt ?    /  29 June 2021 )

How much will this cost to produce 1,000 litres of water ?

 My guess :

       Ø  Capital Cost……………………….. Rs  1,600 crore

  Running Cost

      Ø  Interest @ 15 %...........................................................  Rs   240  Cr

      Ø  Depreciation @ 10 %.....................................................  Rs   160  Cr

      Ø  Operating Expenses @ 20 % ( Manpower+Electricity+OH )… Rs   320  CR

  TOTAL ……………………………………………………………………………………………Rs  720  Cr

Assuming 360 working days ( to round-up ), this works out to…Rs  2  Cr / day ( = Rs 20,000,000 )

To produce 200 MLD = 200,000,000 litre per day

Works out to Rs 20 / 200 litre ( Rs 100 / 1,000 litre, as against Rs 18 / 1000 litre reported in the news !

 

Now, if the estimated cost goes up:

#   from  Rs  1600 Crore

#   to      Rs  18,000 Crore

Then per litre cost would go up by 11 TIMES !

That means, the revised cost would be Rs 1100 for 1000 litre

Rs 1.1 / litre !

Going by past records ( of project executions ), you can safely assume that instead of :

#  4 years, completion would take 8 years

#  Rs 18,000 Cr, cost would go up to Rs 36,000 Cr

So, Mumbai-ites would get desalinated water at Rs 2.2 / litre  ( more likely, Rs 3.0  / litre )

As against this, a 20 Litre Mineral Water jar ( of BHOOMI brand ) sells for Rs 30 ( ie ; Rs 1.5 / litre )

Elephants don’t get any whiter !

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Dear Shri Uddhav Thackerayji,

I urge you scrap this project and get experts to evaluate alternate ( technology ) solutions listed below

With regards,

Hemen Parekh  /  hcp@RecruitGuru.com / 25 Nov 2021

 

 

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